As restaurants seek to retain customers in the face of fierce competition for digital consumer orders, those who reward customers for their spending have the advantage. However, with loyalty programs now the norm, consumers expect more than the standard model, whereby they receive a set number of points for every dollar spent to redeem for discounts or free menu items.
Fast-casual chain Sweetgreen, for its part, announced on Monday (June 27) the launch of a pilot test of a loyalty program, Rewards and Challenges, in which members complete tasks (for example, spend 20 $ or add a secondary item) to redeem offers (eg, receiving a $4 credit or a free drink).
“We see rewards and challenges as a way to double down on digital relationships held and create a more personalized experience for our customers,” Sweetgreen co-founder and CEO Jonathan Neman said in a statement. “With approximately two-thirds of our first quarter 2022 digital sales coming from first-party digital channels, we are excited to take this next step in our journey to reimagine the future of loyalty at Sweetgreen.”
The program isn’t Sweetgreen’s first foray into loyalty rewards. The company ended the previous iteration of its loyalty program in March 2021, citing pandemic hardship as a factor in the restaurant’s site’s FAQ section.
Read more: Preparing to go public, Sweetgreen’s aggressive digital efforts could be misdirected
Nearly a third of all U.S. consumers use restaurant rewards programs monthly, according to data from the March/April edition of PYMNTS’ Digital Divide series, “The Digital Divide: Regional Variations in U.S. Food Ordering Trends and Digital Adoption, created in collaboration with Paytronix.The study, which is based on a survey of more than 2,500 American adults who regularly buy food from restaurants, found that 30% of respondents had used a loyalty program in the previous 30 days.
See more : New research shows regional idiosyncrasies in dining matter in tailoring restaurant offerings
However, the fixed points per dollar structure has become so commonplace that today brands are looking for ways to increase frequency that can stand out in the sea of loyalty offers available. Jason Scoggins, senior director of loyalty and CRM (customer relationship management) at Chipotle, said in an interview with PYMNTS this month that loyalty programs that don’t offer unique and creative experiences risk fall behind.
Read more: Chipotle Says Loyalty Launch Will Help Canadian Fandom Catch Up With U.S.
“Today’s loyalty programs need to go beyond the transactional ‘win and burn’ programs of the past,” Scoggins said. “In many cases, loyalty programs are the only opportunity for businesses to connect with their customers, and consumers expect more from a brand if they want to open up to that connection.”
Similarly, Austin, Texas-based brand Torchy’s Tacos, which has 100 locations in 11 states, announced the launch of a rewards program earlier this year that offers surprise rewards members can neither anticipate nor control.
See more : Restaurants are rolling out loyalty offers beyond the points-per-dollar standard
“We wanted to build a loyalty program that wasn’t just points and punches; we wanted to build something fun, unique and different,” Torchy CMO Scott Hudler told PYMNTS in an interview. “So the way we’ve built it, it’s not a points-based system, but it’s more of a surprise and a treat. The world isn’t waiting for another loyalty program. What are you going to you do – it sounds corny, but – to earn their loyalty to your loyalty program?”